The New York Times says a successful ad relationship with Google may justify a higher offer from Yahoo suitors. Analysts believe outsourcing search ads to Google will boost Yahoo's cash flow, but few are optimistic that it will ultimately drive Microsoft's offer up.

It is uncertain whether its trial relationship with Yahoo means Google may want to buy it, though Microsoft may be incited to increase its bid if it thinks Google is moving in on the deal.

"Our proposal remains the only alternative put forward that offers Yahoo shareholders full and fair value for their shares, gives every shareholder a vote on the future of the company, and enhances choice for content creators, advertisers, and consumers," Microsoft was quoted as saying.